"What happens in Vegas"... Will likely end up on this site. Sorry, Las Vegas Chamber.

Wednesday, June 27, 2012

And About That Other Case of Tax Evasion...

Perhaps there's new meaning to the term "Apple of gold stocks". Public News Service has more on what's still the biggest tax evasion scheme in Nevada's history.

Tax-research consultant David Kersten, owner of Kersten Communications, still is compiling the report but says the big picture is clear. Numerous state exemptions allow local mines to only pay taxes on about a third of the value of the precious metals they extract. Kersten says they pay a state tax of just 5 percent on that smaller value.

"So, it really works out to just $71 million on a total of $6.6 billion in the value of what they extracted."

Mining industry lobbyists say the companies also pay the modified business tax and sales tax to the general fund. But Kersten says all businesses pay that, and thinks the state is too lenient about the mining tax. He compiled the report for the Progressive Leadership Alliance of Nevada (PLAN), which will present the findings to the Mining Oversight Commision on Thursday.

Kersten, who is updating the 2009 report called "Fool's Gold," says it shows that, while Nevada ranks near the bottom in taxing mines, the industry is enjoying record profits.

"Newmont called itself the 'Apple of gold stocks.' These companies, their profits are up 20 and 30 percent, even more - and compared to a few years ago, they have huge growth in profits and production."

Of the 13 Western states where mining is active, he says Nevada is all but alone in handing out such sizable tax breaks to the industry.

"Every other state except for Alaska taxes on the gross value of gold. Nevada's unique in that it allows all of these deductions."

Something's got to give. That's what Nevada voters want to see. But will it finally happen?

While it's typically been incredibly difficult for any kind of mining tax reform to survive in Carson City, it may not always be this way. After all, how can the overwhelming majority of Nevadans be ignored any longer? Can we really afford to keep waking up to deja vu?